H.O.L Test case appeal. Judgement Declared. ***See Announcements***

[popeye1]

do they decide no, its auto paid then they charge you ,

[kennyh]

Reading through the regulations, (UTCCR) the CCA, (s.140A) etc, it's clear that fairness turns on the facts of an individual case. What is fair is one case may not be fair in another, etc, etc.

 

Fair enough but Joe Soaps like me are going to need help, initially, identifying just what is and isn't fair. A steep learning curve it may be but, I feel sure a little help will go a very long way

[the_shadow]

Call me gluten for punishment, (well, you know me) but I really, really can't see how generic templates will help anyone any more.

 

Reading through the regulations, (UTCCR) the CCA, (s.140A) etc, it's clear that fairness turns on the facts of an individual case. What is fair is one case may not be fair in another, etc, etc.

 

While we can cover the legalities of the guidance on what fairness means on these forums, I think that each claimant needs to show unfairness in their own case. It even goes beyond the standard of getting the Banks to show that their charges are fair by challenging them, as the OFT missing a trick with their case has scuppered any "mass cause" of action.

 

I can see why the QC's are taking their time - after all, if it was easy, we'd all be QC's - but I'm struggling to see what their conclusion will be that is applicable to the masses.

 

We've all seen examples of unfairness, so I think the discussions should move on to those, now. Things to my mind include coercing folk in to taking additional lending, probably irresponsibly so, particularly focussing on the poor considering overdrafts purely made up of bank charges and it's unfair interest.

 

I'm also beginning to think that the spate of Default challenges relating to overdraft charges may begin to fail, as a result of all this, unless this inherent unfairness can be shown at the same level of evidence as above.

 

I have 5 days to amend my POC...

 

I think Popeye has pointed out what I consider the main "fairness" contention, that is that the bank decides whether to make the payment or not... it charges you which ever way it goes, are we saying a charge of £25 which in the case of HSBC could cascade up to £100 if you'd had multiple attempts is fair for a decision that is a split nano second and may take the account say £10 overdrawn?

 

This I would back up with the inherent unfairness of the fact that the banks have admitted that the burden for free banking is placed mostly on the most vulnerable to charges and the ones that can least that can afford it.

 

Just my thoughts tho.. and I'm sure Yourbank can pick holes in them ;-)

 

S.

[popeye1]

Why not say no you cannot have the money,what reasons do they have for allowing unauthorized payments.Is it all auto to a certain point,what or who decides it stops.This all might sound silly but just looking at another angle.

Edited January 13, 2010 by popeye1

[ian6pot]

Why not say no you cannot have the money,what reasons do they have for allowing unauthorized payments.Is it all auto to a certain point,what or who decides it stops.This all might sound silly but just looking at another angle.

 

Unauthorized payments? Forgive me for being stupid,finance is not my strong point which would explain why i have a load of bank charges but my bank have never ever,and i mean NEVER paid anything for me when i have not had money in my account yet at the last tot up i have paid £2500 in charges.

 

Can someone explain in plain english please,what have i "bought" for my £2500.

Is it for some kind of service?if so i have not had it yet.

 

does the above situation go in my favour as i have not at any time used the banks money and been charged for it.Instead the bank has done nothing and charged me for it:mad:

[reallymadwoman]

From a post I originally made on 25th November (when the decision was announced) which may or may not help an individual make a case for unfairness in their particular circumstances.

 

Paragraph 64 of the Supreme Court judgement seems to be the key to the possible ‘get out’ in the last sentence of the statement read out in court this morning.

 

‘64. Mr Crow did not submit before us that if the Relevant Charges formed part of the price paid in exchange for the package of services, they could not be included within the meaning of the word “price” in Regulation 6(2). I consider that Regulation 6(2) could apply to a complaint that the Banks’ charges overall, of which the Relevant Charges are an important element, are unfair because those who pay them pay an excessive amount in exchange for the package of services in respect of which they constitute part of the payment. Thus the issue of whether or not the Relevant Charges form part of the “price or remuneration, as against the goods or services supplied in exchange” within Regulation 6(2) is not necessarily academic. No attack has yet been made, however, on the level of the Banks’ charges overall.’ (my emphasis)

 

From the figures in the judgement, about 28% of current accounts get these charges, so 72% do not. This means that 28% of current account holders are paying for most of the services for all 100% of current account holders, which is patently unfair.

 

Just suppose that some other service for which we have little or no choice but to accept the standard terms operated in a similar way, say your electricity supplier. 72% of their customers are charged next to nothing for electricity, but 28% pay the bills for everyone. House 1 pays £20 a year, house 2 pays £2000. Would anyone stand for that? How about if the 28% were only in areas of low income, which is effectively the people most likely to get bank charges? Let’s get even more extreme. I need to buy blinds for my son’s bedroom. Suppose I’m a favoured customer so though the blinds retail at £500, I’m only charged £50. You need blinds too, but you’re not a favoured customer so you get charged £950 to make up the difference. You simply wouldn’t pay it, but with banks we have no choice. It is almost impossible to live today without a bank account but there’s very little to choose between them so far as charges are concerned.

 

Someone else has already raised the issue of using regulation 5 – sorry, I can’t remember who or where. Regulation 5 is:-

 

‘Unfair Terms

5. - (1) A contractual term which has not been individually negotiated shall be regarded as unfair if, contrary to the requirement of good faith, it causes a significant imbalance in the parties' rights and obligations arising under the contract, to the detriment of the consumer. Banks can charge what they like and we have no choice but to pay. Seems a significant imbalance to me.

 

(2) A term shall always be regarded as not having been individually negotiated where it has been drafted in advance and the consumer has therefore not been able to influence the substance of the term. Goes without saying that the terms are not individually negotiated.

 

(3) Notwithstanding that a specific term or certain aspects of it in a contract has been individually negotiated, these Regulations shall apply to the rest of a contract if an overall assessment of it indicates that it is a pre-formulated standard contract.

 

(4) It shall be for any seller or supplier who claims that a term was individually negotiated to show that it was.

 

(5) Schedule 2 to these Regulations contains an indicative and non-exhaustive list of the terms which may be regarded as unfair.’

 

Relevant bits of schedule 2 seem to be :-

 

‘© making an agreement binding on the consumer whereas provision of services by the seller or supplier is subject to a condition whose realisation depends on his own will alone;’ the bank decide whether or not to pay that DD or whatever

 

‘(e) requiring any consumer who fails to fulfil his obligation to pay a disproportionately high sum in compensation;’ haven’t the banks maintained that if you keep within your overdraft limit, i.e. fulfil your part of the bargain, no charges?

 

‘(j) enabling the seller or supplier to alter the terms of the contract unilaterally without a valid reason which is specified in the contract;’

 

‘(k) enabling the seller or supplier to alter unilaterally without a valid reason any characteristics of the product or service to be provided;’ Not sure how, but these might be relevant.

 

However, using regulation 5 is still subject to the clauses about core terms and price so I think that to use it we would have to find a way of arguing that charges are not part of the price for the services, and how could they be if most people do not have to pay them? The package of services is provided for a charge. Let the banks justify that charge being so much higher for a relatively small proportion of their customers. Debate on this one, please, hopefully leading to amended particulars of claim.

 

One final point, and if you’ve got this far I promise I’ll shut up in a minute. There is quite a lot of fuss at the moment over responsible lending, mostly in relation to loans and mortgages, but why should overdrafts be different? The bank chose to pay the direct debit or whatever took you into the overdraft, therefore they chose to lend you the money. How many stories are on these forums where just one stupid charge plus interest spirals totally out of control? The bank eventually ‘persuade’ their customer to take a loan to pay it off. Customer can’t afford to both make the loan payments and eat, so overdraft spirals out of control again leading to another loan and on and on and on. Justify that as responsible lending! Paying an unauthorised overdraft charge or a returned item charge is supposed to be paying for someone to make a decision as to whether to lend you the money, in which case they should be responsible decisions based on ability to pay, which they patently are not.

Would the customer have got into that never ending spiral if the bank had spelled out the effects of not clearing the overdraft every month as they now have to spell out the effects of only making minimum payments on the credit card? Possibly – most of us do after all only have so much money each month to go around – but possibly not. Allegations of irresponsible lending might only be another string to the bow, but how and where could we use these?

 

Thinking entirely 'out of the box', how about a challenge based on indirect discrimination, i.e. a practice that will tend to put a whole group of people at a disadvantage?

 

It is an accepted fact that people on low incomes are more likely to have charges applied to their bank accounts.

Disabled people are more likely to be on a low income, so are single parents, who are also more likely to be female.

Bank charges are therefore likely to discriminate against disabled people and women.

[robnfc]

one thing ive always struggled with , if the banking system is automatic then why do we get charged for an unauthorised debit and not an authorised debit , surely the process is just same , yes or no.

 

What extra work constitutes a service, a letter? but that is also automatic.

 

Basically the bank can pick and choose which transaction it considers as a service to charge for when really there is no difference between them.

Edited January 14, 2010 by robnfc

[reallymadwoman]

one thing ive always struggled with , if the banking system is automatic then why do we get charged for an unauthorised debit and not an authorised debit , surely the process is just same , yes or no.

 

What extra work constitutes a service, a letter? but that is also automatic.

 

Basically the bank can pick and choose which transaction it considers as a service to charge for when really there is no difference between them.

 

I believe this was the whole basis of their arguments in the test case. Their charges are a charge for the whole package of services - DDs, SOs, cheques etc - rather than a charge for a specific service. This of course doesn't explain why some people have to pay for their services and some don't, hence why I think it is unfair.

[robnfc]

So how did the banks justify that in court?

[robnfc]

also on another point , doesnt bank charges and especially the automatic system take away the right to remedy the situation

[reallymadwoman]

So how did the banks justify that in court?

They didn't have to. The regulation which the OFT was using to challenge the charges specifically says that the price of a service cannot be assessed for unfairness, so if the charges are part of the price, they cannot be assessed as unfair.

 

also on another point , doesnt bank charges and especially the automatic system take away the right to remedy the situation

 

The banks will argue that you should know that you're going to go overdrawn etc, and remedy it in advance i.e. pay some money into your account to cover it.

[yourbank]

I have 5 days to amend my POC...

 

How are you getting on with it Car ?

[robnfc]

but surely that would mean that the point of remedy is totally pointless as every situation where remedy is allowed would simply be thrown on the basis that the "person should have known"

[reallymadwoman]

If you're thinking of the opportunity to remedy required under the CCA, that is a statutory right that doesn't exist in common law. Since current accounts in general are not subject to the CCA (though overdrafts are) there is no legal right to the opportunity to remedy a breach of your contract unless it is written in to the contract.

[robnfc]

bare with me

[reallymadwoman]

Not that I've ever heard of, unless it's written in to the contract. I could be wrong though.

[robnfc]

ok right to remedy is common law , but its just dawned on me that it doesnt matter because you cannot claim remedy for a service as opposed to a remedy for breach of contract...

 

Althought did I ask for the service provided?

[reallymadwoman]

I think the correct approach is that going overdrawn or exceeding your overdraft limit is a breach of the contract between you and the bank, therefore the rights and obligations of the parties in relation to that breach are as set out in the contract, which of course says the bank can charge you for doing it, but the supreme court judgement says that charge is actually part of their charge in general for providing the service at all, so it's not a charge for breach of contract (which would have to be the amount of damage caused by the breach or it would be a penalty, which isn't allowed). Confused? Join the club!

 

What I just can't get my head around is that if it's not a charge for breach of contract but a charge for banking services, why is it only applied if you breach the contract?

[robnfc]

I am now , im probably going over old points but im just trying to understand whats going in my poc.

 

I now thinking about the whole , I never asked for this service , if I mot my car I want it moted not valeting with new tyres and a new exhaust.

[srfrench]

Or in other words if I want to MOT my car...I expect to billed for work done.

 

Not to say, here's my car for MOT....that's ok sir, we won't MOT it.....but here's our bill for not carrying out the MOT.

[srfrench]

Also what happens when they cock up, they say no compensation and the funds will be returned to your account within 5 days!!!!!! FAIR?

[robnfc]

good point , anyone looked up extortion law?

[srfrench]

AAANNNNNNNDDDDDDDDDD!!!!!

 

It's been upheld by the OFT and the Courts that the way a charge and interest is worked out is NOT clear and even caused the Banks a few problems to explain how it's worked out in Court.

 

Thus, even if you were to put funds into your account, the addition of charges and even the interest on toip of that would send you back into unauthorised o/d area again!!!!!! FAIR!!!!

[robnfc]

extortion / an oppressive misuse of power , sounds familiar

[missdpd]

Interestingly, received a letter from NatWest stating that my complaint with regards to charges is not being upheld etc.

 

They do say, however, that if my complaint is not in relation to the level of charges but to the fairness or lawfulness of them, to let them know by way of setting out details so that they may consider my complaint further.

 

xx